A public comment from the CEO can help calm the nerves of jittery employees and investors. It can also make them even more anxious.

This week, of course, the issue of whether and when to disclose a CEO’s illness came back to the forefront after the president of the United States tested positive for COVID-19. More than a dozen top company leaders already disclosed positive tests in the early months of the pandemic, but many experts' views on all this continue to evolve given how complex the scenarios have become--with some positive tests leading to no illness and others to very serious conditions and fatalities.

Officially, US Securities and Exchange Commission regulations require disclosure for public companies when the illness becomes significant enough to be material, meaning it has the potential to have an adverse impact on the business. But what one organization considers material another may not, says Alan Guarino, vice chairman of Korn Ferry’s Board and CEO Services practice. “It’s not black-and-white,” he says. Not surprisingly, that means some firms have chosen to disclose after the CEO recovered, while others have sent out notices immediately, putting the CEO on medical leave and enacting a temporary succession plan. At the opposite end of the spectrum, it’s probably safe to assume that some positive tests haven’t been disclosed. 

Jane Stevenson, Korn Ferry’s global leader for CEO succession and vice chairman of the firm’s Board and CEO Services practice, says when the risk level at the onset of an illness is unknown, the decision to disclose “becomes a tightrope walk between unnecessarily destabilizing the business and hiding material information that needs to be shared.” Put another way, disclosing a positive COVID-19 test could send investors and employees into a panic, potentially erasing millions of dollars in market value, without it ever escalating to the point where the CEO becomes sidelined from performing his or her duties. Conversely, in an environment where purpose and health and safety are paramount, not disclosing a positive test, even after recovering, could be taken by investors and employees as a lack of transparency and adversely impact the stock price as well.

To be sure, from a communications perspective, the potential for a CEO’s positive test result to leak out via social media or other channels runs the risk of the organization losing control of the message, says Richard Marshall, global managing director of Korn Ferry’s Corporate Affairs Center of Expertise. “With something as serious as an illness, you really want to coordinate messaging to let everyone know at the same time,” he says. “If it leaks out and you’re not in front of it, you are constantly on the defensive and often having to fight misinformation.”

Ultimately, it’s up to the board of directors to decide when to disclose a CEO’s illness. And while the board’s fiduciary duty is to the organization’s shareholders, the pull of maintaining the CEO’s privacy is strong, says Guarino. He adds, however, that as leaders of public companies, CEOs are public figures in their own right and, as such, are considered akin to celebrities, athletes, and politicians in terms of their expectation of privacy. Particularly as it relates to Fortune 100 companies, Guarino says, “The magnitude of the company’s impact on individuals and institutions makes the CEO a ‘quasi’ public figure.”

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